Fewer Canadians planning to buy vehicles

Growing concern over tariffs and affordability is influencing whether Canadians plan to buy vehicles, with fewer people expecting to purchase a car in the coming years as trade tensions and household costs increase, a study on car ownership in Canada found.

Turo’s State of Car Ownership in Canada 2026 reported that 75 per cent of Canadians are concerned tariffs could raise vehicle prices in 2026 and nearly a third say the risk of tariffs makes them less likely to buy a vehicle. Compared with 2024, the number of Canadians planning to purchase a vehicle within the next three years has dropped by 15 per cent.

Trade relations are also affecting buying decisions, with 70 per cent of respondents saying they would avoid purchasing an American-made vehicle until Canada-U.S. relations improve.

“Uncertainty in the economy is forcing Canadians to rethink what it really means to ‘own’ a car,” said Bassem El-Rahimy, head of Turo Canada. “From tariffs to cost-of-living pressures, flexibility matters more than ever for Canadians.”

Overall vehicle ownership remains steady, with 85 per cent of Canadians reporting they own a car, but the study pointed to widening generational differences. Younger Canadians face higher costs and lower ownership rates, particularly among Gen Z and younger Millennials.

Gen Z drivers reported the highest annual vehicle costs, averaging $5,820, while 36 per cent of Gen Z respondents said they do not own a vehicle, compared with 15 per cent across all age groups. Ownership among Canadians aged 25 to 34 declined nine per cent between 2025 and 2026.

Rising costs are also affecting how often Canadians use their vehicles. While average annual ownership costs fell nine per cent to $4,999, 77 per cent of respondents said their monthly vehicle expenses exceed what they can comfortably afford, up from the previous year.

More than half of Canadians said they have changed their driving habits to reduce costs, including driving less frequently. Canadians are expected to spend an average of 409 hours driving in 2026, down from 414 hours the year before, with vehicles remaining parked for more than 22 hours per day on average.

As a result, some Canadians are reconsidering traditional ownership models. More than half of respondents said they would prefer to access a vehicle only when needed rather than owning or leasing one, and 41 per cent said they would consider renting a vehicle for an extended period.

“We’re seeing growing interest from people navigating job changes and evolving life phases who want access to a vehicle without the financial strain or long-term commitment that comes with ownership,” El-Rahimy said.

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